Wholesale Market Conduct

Central Bank of Ireland is the competent authority in Ireland for wholesale market conduct supervision under a range of legislation. Wholesale financial markets regulation encompasses complex interconnected markets, a wide range of financial products and a large and varied group of professional market participants.

The Wholesale Market Conduct Team

Due to the increase in scale and sophistication of wholesale financial market activity conducted in and from Ireland and by branches of Irish firms in other jurisdictions, Central Bank of Ireland has enhanced its approach to supervision of this sector. This includes developing systematic capabilities to supervise conduct in wholesale markets.

In 2018, Central Bank of Ireland established a specialised team, the Wholesale Market Conduct Team. The team, is tasked with carrying out market conduct risk assessments of financial service providers engaging or applying to engage in wholesale market activity.

5 Principles for a Proper and Effectively Regulated Securities Market

The Central Bank will continue to engage with industry in relation to wholesale market conduct risk. We will be guided by the expectations that were set out in the letter to industry participants in March 2019 and our 5 principles for a proper and effectively regulated securities market. Under these principles a proper and effectively regulated securities market is one that:

  1. Provides a high level of protection for investors and market participants
  2. Is transparent as to the features of products and their market price
  3. Is well governed (and comprises firms that are well governed)
  4. Is trusted, by both those using the market to raise funds and those seeking to invest
  5. Is sufficiently resilient to continue to operate its core functions in stressed conditions and is able to innovate appropriately as markets evolve.

Industry Communication - March 2019

Central Bank of Ireland has written to existing and incoming financial service providers to set out its expectations in respect of how these financial service providers identify, mitigate and manage market conduct risk. A copy of this letter, which applies to all financial service providers engaging in wholesale market activity, irrespective of scale or business model can be found below.

Wholesale Market Conduct Risk - Dear CEO Letter | pdf 710 KB

Industry Communication - January 2020

Central Bank of Ireland has issued a second industry communication in relation to securities market conduct risk, which provides an overview of the key findings from the Central Bank’s 2019 market conduct supervisory work. It also sets out areas where regulated entities should improve their organisational arrangements for managing market conduct risk and includes further expectations for regulated entities and issuers (building on the March 2019 industry communication). Finally, the letter also outlines areas of focus for Central Bank market conduct supervisors in 2020.

Securities Markets Conduct Risk - Dear CEO Letter | pdf 734 KB